By the Deputy Chief, Consumer Policy Division, Consumer & Governmental Affairs Bureau:
1.
In this Order, we consider the complaints1 alleging that Preferred Long Distance,
Inc., (PLD) changed Complainants’ telecommunications service providers without obtaining authorization and verification from Complainants in violation of the Commission’s rules.2 We conclude that PLD’s actions did result in unauthorized changes in Complainants’ telecommunications service providers and we grant Complainants’ complaints.
2.
In December 1998, the Commission released the Section 258 Order in which it
adopted rules to implement Section 258 of the Communications Act of 1934 (Act), as amendedby the Telecommunications Act of 1996 (1996 Act).3 Section 258 prohibits the practice of

“slamming,” the submission or execution of an unauthorized change in a subscriber’s selection of a provider of telephone exchange service or telephone toll service.4 In the Section 258 Order, the Commission adopted aggressive new rules designed to take the profit out of slamming, broadened the scope of the slamming rules to encompass all carriers, and modified its existing requirements for the authorization and verification of preferred carrier changes. The rules require, among other things, that a carrier receive individual subscriber consent before a carrier change may occur.5 Pursuant to Section 258, carriers are absolutely barred from changing a customer's preferred local or long distance carrier without first complying with one of the Commission's verification procedures.6 Specifically, a carrier must: (1) obtain the subscriber's written or electronically signed authorization in a format that meets the requirements of Section 64.1130; (2) obtain confirmation from the subscriber via a toll-free number provided exclusively for the purpose of confirming orders electronically; or (3) utilize an independent third party to verify the subscriber's order.7
3.
The Commission also has adopted liability rules. These rules require the carrier
to absolve the subscriber where the subscriber has not paid his or her bill. In that context, if the subscriber has not already paid charges to the unauthorized carrier, the subscriber is absolved of liability for charges imposed by the unauthorized carrier for service provided during the first 30 days after the unauthorized change.8 Where the subscriber has paid charges to the unauthorized carrier, the Commission’s rules require that the unauthorized carrier pay 150% of those charges to the authorized carrier, and the authorized carrier shall refund or credit to the subscriber 50% of all charges paid by the subscriber to the unauthorized carrier.9 Carriers should note that our

actions in this order do not preclude the Commission from taking additional action, if warranted, pursuant to Section 503 of the Act.10
4.
We received Complainants’ complaints alleging that Complainants’
telecommunications service providers had been changed to PLD without Complainants’ authorization.11 Pursuant to Sections 1.719 and 64.1150 of our rules,12 we notified PLD of the complaints and PLD responded.13 PLD states that authorizations were received and confirmed through third party verifications (TPVs). We have reviewed the TPVs that PLD submitted with its response. In each case, during the course of the TPV, the verifier recited a telephone number presumably associated with the business. However, our rules require that the TPV specifically elicit the “telephone numbers to be switched,” rather than merely verifying numbers associated with a business or residence, or for what purpose the numbers are used.14 As we emphasized in the Fourth Report and Order, “any description of the carrier change transaction…shall not be misleading.”15 We find that PLD has failed to produce clear and convincing evidence that Complainant’s authorized carrier changes.16 Therefore, we find that PLD’s actions resulted in unauthorized changes in Complainants’ telecommunications service providers and we discuss PLD’s liability below.17
5.
PLD must remove all charges incurred for service provided to Complainants for
the first thirty days after the alleged unauthorized change in accordance with the Commission’s liability rules.18 We have determined that Complainants are entitled to absolution for the charges incurred during the first thirty days after the unauthorized changes occurred and neither the authorized carriers nor PLD may pursue any collection against Complainants for those charges.19Any charges imposed by PLD on the subscriber for service provided after this 30-day period shall be paid by the subscribers at the rates the subscribers were paying to their authorized

10See 47 U.S.C. § 503.
11See Appendix.
12
47 C.F.R. § 1.719 (Commission procedure for informal complaints filed pursuant to Section 258
of the Act); 47 C.F.R. § 64.1150 (procedures for resolution of unauthorized changes in preferred carrier).
13See Appendix.
14See 47 C.F.R. § 64.1120 (c)(3)(iii).
15See 47 C.F.R. § 64.1120 (c)(3)(iii) and Fourth Report and Order, 23 FCC Rcd 493 (2008).
16See 47 C.F.R. § 64.1150(d).
17
If any Complainant is unsatisfied with the resolution of this complaint, such Complainant may
file a formal complaint with the Commission pursuant to Section 1.721 of the Commission’s rules, 47 C.F.R. § 1.721. Such filing will be deemed to relate back to the filing date of such Complainant’s informal complaint so long as the formal complaint is filed within 45 days from the date this order is mailed or delivered electronically to such Complainant. See 47 C.F.R. § 1.719.
18See 47 C.F.R. § 64.1160(b).
19See 47 C.F.R. § 64.1160(d).
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Federal Communications Commission

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carriers at the time of the unauthorized changes.20
6.
Accordingly, IT IS ORDERED that, pursuant to Section 258 of the
Communications Act of 1934, as amended, 47 U.S.C. § 258, and Sections 0.141, 0.361 and 1.719 of the Commission’s rules, 47 C.F.R. §§ 0.141, 0.361, 1.719, the complaints filed against Preferred Long Distance, Inc., ARE GRANTED.
7.
IT IS FURTHER ORDERED that, pursuant to section 64.1170(d) of the
Commission’s rules, 47 C.F.R. § 64.1170(d), Complainants are entitled to absolution for the charges incurred during the first thirty days after the unauthorized change occurred and neither the PLD nor the authorized carriers may pursue any collection against Complainants for those charges.
8.
IT IS FURTHER ORDERED that this Order is effective upon release.
FEDERAL COMMUNICATIONS COMMISSION
Nancy A. Stevenson, Deputy ChiefConsumer Policy DivisionConsumer & Governmental Affairs Bureau

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